FCC Universal Service Now Means Broadband

The FCC unanimously approved a plan to overhaul a portion of the Universal Service Fund to bring broadband coverage to all America. This move redirects funds originally intended to bring telephone service to all Americans to now bring universal broadband Internet access.

Reform of the Universal Service Fund (USF) and the Intercarrier Compensation (ICC) system means that money that once was intended to provide basic, landline phone coverage to Americans, especially those in rural areas, now will go to the Connect America Fund to help build up broadband Internet coverage in some of those same rural areas. The changes will also affect the rates that phone companies pay to each other to connect calls locally.

While the definition of broadband as 3 mbps down and 768 kbps up may seem a stretch of the term for many, it is still better than a large portion of the country currently has. Improving speeds can only help these areas when companies such Apple assume large amounts of bandwidth are available for their services. Currently, 18 million Americans do not have broadband, even with this definition, available to them. This move recognizes that more and more an Internet connection with a large pipeline is necessary to participate in society and the economy.

This change will also save an estimated US$1 billion per year for consumers who make long-distance calls from their mobile phone. Landline users will also benefit from the new system.

It is believed that without this reform, the areas served and not-served by broadband would not change significantly. With the plan, it is predicted that all Americans would have access to broadband by 2021 and it would provide $2 billion in benefits to consumers.

The Hillquoted Anna Eshoo (D-Calif.), House Telecom subpanel ranking member as saying “The reforms adopted to the USF and ICC system fulfill one of the key recommendations outlined in the National Broadband plan, and will increase access to broadband in rural America, eliminate duplicative subsidies, and finally bring the USF High-Cost program and the ICC system into the 21st century.”